Classes of Actors and their Performance in the Financial Crisis

In order of performance (worst to best), each as a class:


regulated (via SEC NRSRO designation) credit rating agencies (shocking performance and at the center of it all)

MBIA et al (regulated as insurance companies)

French regulated banks

regulated banks and brokerage firms (shocking or at best embarrassing losses)

US unregulated hedge funds (leveraged, marked-to-market daily, $2tr of equity, 10,000 actors, and no significant credit losses)

dumb mortgage borrowers fleeced by unregulated mortgage bankers (as a class they have net received hundreds of $bn)



Perhaps regulators will act soon and vie for the top position.